Market Update for December 16
The oscillating trend on the Nigerian Exchange continued on Thursday as the key performance index wiped out the previous session gains on a low traded volume and negative breadth. As selling sentiment hits the insurance and industrial goods to dragged down the market, thereby making the market attractive for bargain hunters targeting dividend-paying stocks ahead of 2022 financial year-end.
The market’s negative outing and mixed trend were driven by the changes in investment decisions of investors, as market players continue to interpret the recent economic data and happenings in the fixed income market in the midst of omicron and changing monetary policies in the mature markets of the world. We also notice a lower response to investment, as the Christmas season draws closer, with many investors likely wanting to spend more during this period than investing.
Technically, the NGX index’s action has entered another sideways ranging movement on a selling sentiment. Just as low transaction volume prevails to reveal low liquidity and absence of institutional players in the market, as momentum indicators for the day were down, while the ADX is reading 29.53, RSI at 47.92, and Money Flow Index flat at 28.02 points on the daily chart. The continuation of this trend depends largely on the interplay of market forces and inflow of funds into equity space as fixed income market yields remain unclear.
Thursday’s trading started slightly on the upside, before pulling back and fluctuated on selloffs among the blue-chip stocks that pushed the composite index to an intraday low of 42,262.85 basis points from its highs of 42,386.83bps and thereafter close below its opening point at 42,270.236bps.
Market technicals for the session were negative and mixed as volume traded was higher than the previous day’s in the midst of breadth favoring the bears on a negative sentiment as revealed by Investdata’s Sentiment Report showing 94% sell position and 6% buy volume. The total transaction volume index stood at 0.79 points, just as the impetus behind the day’s performance remained relatively weak, as the money Flow Index look down to read 28.02 points, from the previous day’s 33.98points, indicating that funds left the market.
For you to successfully invest and trade in this market, order for Investdata’s video on Buy &Sell Technical Analysis Toolbox to navigate the rest of the year profitably, enhance trading decisions and boost your bottom line. Also, to up your game in stock trading and investing, understanding the key to trading price and index action will go a long way to make the difference in your trading results, check out the video materials below.
Index and Mkt Cap Movement
The benchmark index NGXASI, at the end of the day trading, shed 87.13 basis points, at 42,270.23bps after opening at 41,357.36bps, representing a 0.21% up, just as market capitalization fell by N45.46bn, closing at N22.06tr, from the opening value of N22.10tr, also representing 0.21% value loss.
Attention: If you have not signed up for INVESTDATA’s buy and sell signal setup, don’t delay, because the number of stocks entering their buying range has just increased to 30 as they build a new bullish base and positive chart patterns to be on our watchlist. These stocks have double potentials to rally, considering their earnings prospect and the recovery move of the market at this time.
To become a member, send ‘YES’ or ‘STOCKS’ to the phone numbers below. Take advantage of this service to buy right and sell right at the current oscillating market in the midst of earnings season, portfolio reshuffling, and repositioning as we await an economic reform policy to stimulate and re-track the economy to the path of growth and development.
The session’s downturn was driven by selloffs and profit taking in stocks like Dangote Cement, Lafarge Africa, FBNH, UCap, Nascon, CAP, Livestock Feeds, Honeywell, and UPDC, among others, which impacted negatively on Year-To-Date gain, reducing it to 4.97%. Market capitalization stood at N1.12tr YTD, representing a 4.74% growth from the year’s opening value.
Mixed Sector Indices
Sectoral performance indexes were mixed, as NGX Industrial Goods and Insurance closed lower by 0.73% and 0.33% respectively, while NGX Oil/Gas led the advancers, after gaining 0.54%, followed by Banking and Consumer goods with 0.45% and 0.11% respectively.
Market breadth turned negative as losers outpaced gainers in the ratio of 20:15, while transactions in volume and value terms were up after stockbrokers traded 249.43m shares worth N3.57bn, compared to the previous day’s 229.46m units valued at N2.63bn. Volume was driven by trades in FBNH, Access Bank, ETI, UBA and Zenith Bank.
Royal Exchange Assurance and Charms were the best-performing stocks after gaining 5% and 4.76% respectively, closing at N0.63 and N0.22per share respectively on market forces. On the flip side, Livestock Feeds andUPDC lost 10% and 8.33% respectively, closingat N1.80 and N1.10 per share, purely on selloffs and profit taking.
Market Outlook
We expect the low liquidity and changing investment decision to keep the trend on this direction ahead of Santa Claus week as market players digest November consumer price index and happenings in fixed income market after the NGX index action pulled back to trade above its 50-Day Moving Average on a low sell volume in the face of assets rebalancing and seasonality likely to influence stock prices ahead of year-end window dressing.
The relatively low volume traded in the midst of retracement is creating new buy opportunities on the strength of the Q3 numbers. Also, candlestick formation and volume traded during the session revealed that institutional players are not buying yet. It is equally noteworthy that during a ranging market many players seat on the fence waiting for a breakout or down before jumping into any position. Even as many stocks are trading within their buy ranges, a situation expected to attract more funds into the stock market, given the Dividend Yield capable of serving as a hedge against inflation.
2022 Q1 Master Class Actionable Trading Plan & Opportunities
Now is the time to start planning for next year. If you don’t make a plan for 2022 right now, you could be left behind, which means you will end up doing the same things you did this year.
How did that work out for you? If you want to focus on building profitable portfolio in 2022. Then get access to Q1 2022 Master Trading Action Plan right away. The Action Plan includes 5 Hot Stocks for capital appreciation and 5 Double digit Dividend Paying Stocks. Get ready for Q1 2022.
Meanwhile, the home study packs on Comprehensive Stock Market trading course video, Stock Market Analysis Beyond Fundamental & Technical Analysis, INVEST 2021 New Opportunities & New Paths To Profits Summit materials and 10 Golden Stocks for 2021, Strategies and How to invest profitably in this Changing Market Dynamics/ Recession, Mastering Earnings Season For Profitable Investing and Trading in any market situation/ cycles, Life Beyond COVID 19 Investment Opportunities In The Stock Market are now available. To obtain your pack send ‘Yes’ or ‘Stock’ to 08028164085, 08179547605 now.
Ambrose Omordion
CRO|Investdata Consulting Ltd
ambrose.o@investdataonline.com
Tel: 08028164085, 08179547605
